Southern Africa: EU official ’creating rift’
Inter Press Service (Johannesburg)
13 July 2007
Southern Africa: EU Official ’Creating Rift’
David Cronin
Brussels
A top European Union official has been seeking to create divisions between South Africa and its neighbours in talks aimed at establishing a free trade deal, African diplomats have alleged.
Karl Friedrich Falkenberg, the deputy-director general for trade at the European Commission, is said to have recommended that measures against firms from South Africa should be contemplated by governments from its bordering countries.
The recommendation was made in June during talks in Walvis Bay, Namibia between the EU and the Southern African Development Community (SADC).
During these negotiations, some SADC governments voiced concerns that their exports to South Africa are likely to be adversely affected if an EU strategy for opening the South African market to greater imports from Europe succeeds.
The EU is hoping to sign a free trade deal known as an Economic Partnership Agreement with eight SADC countries — Angola, Botswana, Lesotho, Mozambique, Namibia, Swaziland, Tanzania and South Africa — by the end of this year.
EU officials hope that the EPA will lead to European firms having greater access to South Africa than they have under the free trade agreement concluded between the EU and South Africa in 1999. The EU side has gone so far as to advocate that tariffs levied by South Africa on a wide range of goods should be removed.
An African diplomat, speaking on condition of anonymity, described Falkenberg’s suggestion that neighbouring countries should place barriers on South African firms as "shocking", as it runs counter to the European Commission’s stated desire of using the EPA to foster closer economic and political ties among the countries of southern Africa.
"One of the oft-stated assertions of Mr Falkenberg and other prominent Commission officials is that these negotiations are meant to support a regional integration process," the diplomat added. "This advice by Mr Falkenberg goes against what he has been saying."
The diplomat was also scathing about threats made by the EU executive to impose heavy tariffs on imports from southern Africa if their governments do not sign an EPA by Dec. 31. African goods entering the Union’s market currently benefit from a preferential regime, which has been granted a waiver from World Trade Organisation rules. That waiver is due to expire Jan. 1 2008.
"I don’t think people in southern Africa appreciate being bullied," the diplomat said. "We’ve had all of that rubbish for far too long."
IPS contacted Falkenberg, giving him an opportunity to reply to the diplomat’s allegations. But his office said that he is away from Brussels and could not be contacted.
Peter Power, the Commission’s spokesman on trade, denied that Commission officials have been pursuing tactics that conflict with their public statements in favour of African integration.
"This is a load of nonsense," Power told IPS. "We are entirely committed to integration. This is the bedrock of our approach. Regional integration and local integration underpin all dimensions of the EPAs."
Paul Goodison from the European Research Office, which monitors trade relations between the EU and Africa, said: "The main market the European Union wants access to is the South African market. The other markets are insignificant, as far as the EU is concerned."
Goodison said that the EU’s strategy of focusing on targeted markets could have "profound implications" for South Africa.
In a paper published in April, the Commission said it would be even tougher than it has been to date in insisting that barriers faced by European firms wishing to operate in lucrative markets should be removed.
In particular, the Commission pledged to make greater use of international dispute settlements, pointing out that this approach had already paid dividends in recent years. The EU executive had succeeded in challenging a value added tax system in Colombia designed to protect local car manufacturers against imports and a Mexican law on diesel emissions that would have prevented European cars being sold in Mexico.
Goodison added that fears are being expressed in South Africa that the EU may mount a challenge to business schemes designed to help entrepreneurs from the black majority, by arguing that they discriminate against European firms. A South African trade official agreed that the Commission is seeking to drive a wedge between his country and its neighbours.
"The reason is simple," the official said. "With the ACP [African, Caribbean and Pacific] countries, the EU is mostly talking to developing countries. South Africa is a developing country but in some areas is not a developing country. If you go into the rural areas, you will see the needs of a developing country. But the big cities are like London or Geneva or New York."
Wallie Roux, a Namibian trade analyst recently suspended from the beef exporting firm Meatco for criticising the EU’s tactics in the EPA talks, argued that the Commission is wrong to insist that an agreement should be wider in scope than trade in goods. The Commission has been adamant that EPAs must cover such matters as foreign investment, government procurement and competition, even though poor countries had successfully lobbied for the removal of these items from the Doha trade talks, a separate round of negotiations held under the aegis of the WTO.
Southern African countries are not sufficiently prepared to sign a comprehensive EPA by the 31 December deadline, Roux contended.
"It’s a Catch 22 situation," he told IPS. "The countries in Southern Africa only want to concentrate on trade in goods, because that’s what are covered by the WTO waiver. The EU, on the other hand, is still keeping the ’new generation’ issues on the table. If the EU doesn’t soften its stance, there will be no agreement by the end of this year."
